The UK is leading the way in what is set to be a bumper year for European hotel transactions, with year-on-year volumes up 85% during the first six months of 2015, according to real estate company JLL.
Nearly 50% of all hotel deals across the continent, worth a total of £13.2b, have taken place in the UK. Transactions in the UK are up 172% on 2014, while in Germany they have increased by 60%.
Lone Star Funds has been the most active investor in the UK, having spent over £1.2b on more than 13,000 rooms in London and the regions so far this year. The deals achieved by the American private equity company have included 29 Jurys Inn hotels and three hotels under Hilton Worldwide brands purchased in January for £680m, 21 hotels from Moorfield operating under Accor's Mercure and MGallery brands, and 19 provincial hotels, currently operating under the Thistle brand, which will complete on 30 July. All these newly acquired hotels will now operate under Amaris Hospitality, a new company launched by Lone Star to manage its growing collection of branded properties.
Christoph HÁ¤rle, chief executive EMEA, JLL Hotels & Hospitality, said: "It is of little surprise to those in the market that private equity and investment funds are continuing to target European hotels.
"This is a market where yield and visitor base is consistently strong and we are now seeing this type of investor further gather in confidence and start to look beyond the major city hubs and invest in periphery markets and in regional centres."
Chinese investment in the hotel sector is now also expected to flourish following the scrapping of the rule that previously prevented buyers from China investing more than $100m (£64m) overseas.
HÁ¤rle added: "Earlier in the year we predicted that in 2015, the Chinese capital is expected to represent some $5b (£3.2b) in global hotel investment. In EMEA so far we have already seen $1.9b [£1.2b] invested by Jin Jiang for the [French-based] Louvre portfolio and we expect to see more deals before the year is out."
UK hotel investments rises 47% to £1.89b in first quarter of year >>Year ahead expected to be bumper one for hotel transactions >>UK hotel investment reaches eight-year high at £6.1b >>Looking for a job? See all the current hotel vacancies available with The Caterer Jobs >>
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